When Virginia voters approved the Secession Ordinance in May 1861, those in Western Virginia who opposed leaving the Union had to decide whether to recreate a loyal Virginia government or to seek the creation of a new state. In practice, it proved necessary first to do the one and then the other. For those who preferred to create a new state, the crux of the problem was how to satisfy the constitutional process for creation of a state from the boundaries of an existing state. Leaders such as John S. Carlile and Francis H. Pierpont influenced the Second Wheeling Convention to form a "Reorganized Government of Virginia" which became effective on July 1, 1861, with headquarters in Wheeling. This government provided a loyal, unionist government for Virginia and eventually provided the necessary consent to the creation of West Virginia.

The Reorganized Government immediately set about the task of re-establishing government functions at the state, county, and local level. Virginia's secession had split local officials into Union and Confederate factions. These men fought one another for control of county and local governmental units, resulting in anarchy in much of Western Virginia. Pierpont, elected governor of the Reorganized Government of Virginia on June 20, 1861, called on President Abraham Lincoln for military aid. Gen. George B. McClellan and his army brought security to Pierpont's government and legitimacy when McClellan recognized him as the governor of Virginia. Pierpont called the newly elected legislature into session on July 1. The general assembly immediately began the re-establishment of governmental functions, provided for the raising of military units for federal service, and elected new U.S. senators and representatives to represent Virginia in Washington.

The creation of a new state remained a central issue. The Second Wheeling Convention authorized separation of western counties from Virginia and the establishment of a constitutional convention to create a government for the proposed new state, subject to approval by the voters. The voters gave their approval on October 24, 1861, and on the same day they elected delegates to the constitutional convention. A constitution was written by the convention, and in April 1862 it was ratified by voters in those counties where federal troops were in control. Governor Pierpont then called on the legislature of the Reorganized Government to agree to the formation of West Virginia from the state of Virginia. Since there was another government of Virginia sitting in Richmond, it was not at all certain that the actions of the Reorganized Government would find approval in Congress or the courts. The issue then moved to Washington, where, after great debate and much soul searching by congressmen and President Lincoln, the creation of West Virginia was approved. A new legislature was chosen and Arthur I. Boreman was elected as the first governor, to take office on June 20, 1863.

Meanwhile, the governor of the Reorganized Government, Francis H. Pierpont, who had been reelected in November 1862, moved the Reorganized Government to Alexandria, Virginia, where it continued to govern those parts of Virginia under Union control. At the end of the war, Pierpont moved his capital to Richmond and continued to serve as governor of Virginia until 1868.